14/10/2025

BIZ & FINANCE TUESDAY | OCT 14, 2025

20

MARKETS/FROM THE BROKERS

SUNBIZ presents extracts of a selection of commentaries and research reports received from stockbrokers on counters that could be of interest to investors.

DISCLAIMER: The information is extracted from stockbrokers’ commentaries and research reports and do not represent the views or opinions of Sun Media Corporation Sdn Bhd. It is not a solicitation, recommendation or an offer to buy or sell the equities featured. Sun Media Corporation shall not be liable or responsible for any consequences resulting from usage of the information.

[ Compiled by SunBiz Team

Genting launches RM6.74b offer for rest of Genting M’sia KUALA LUMPUR: Genting Bhd has proposed a conditional voluntary takeover offer to acquire all remaining ordinary shares in Genting Malaysia Bhd (GENM) not already held by the group for a cash offer of RM2.35 per share. In a Bursa Malaysia filing, Genting said the offer, which covers 2.87 billion GENM shares or 50.64% equity interest, amounts to RM6.74 billion. It holds 49.36% of GENM as of Oct 10. The offer is conditional on Genting receiving valid acceptances that would raise its stake to more than 50% of the total shares issued. Genting said the offer price of RM2.35 per share represents a premium of between 9.8% and 22.9% over GENM’s historical traded price over the past 12 months up to and including Oct 10, 2025, the last trading day before the offer notice. “The offer provides shareholders an opportunity to realise their investments in GENM at a premium,” the group said. The takeover allows Genting to gain statutory control of GENM and consolidate the subsidiary’s financial statements, independent of accounting definitions of control. Funding for the offer will come from a mix of internal funds and up to RM6.3 billion in debt financing. Genting said its gearing ratio is expected to rise from 0.43 times to 0.50 times on full acceptance. If the acquisition leads to a breach of the 25% minimum public shareholding spread, it may consider delisting GENM from Bursa Malaysia, Genting said. GENM, which operates Resorts World Genting and several international properties, including in the United States and the United Kingdom, recorded a net profit of RM251.2 million for the financial year ended Dec 31, 2024. – Bernama

Ringgit finishes lower as dollar firms on trade concerns THE ringgit slipped against the US dollar at Monday’s close, reflecting renewed strength in the greenback amid lingering trade tensions between the United States and China. At 6pm, the local note fell to 4.2265/2295 against the greenback from Friday’s close of 4.2200/2260. Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the US Dollar Index (DXY) rose 0.21% to 99.185 points, as concerns over US-China relations appeared to ease following President Donald Trump’s remarks over the weekend. According to reports, Trump said the United States will impose a 100% tariff on imports from China, along with restrictions on tech exports, starting Nov 1, 2025, or sooner, depending on China’s response. Mohd Afzanizam also noted that investors remained wary of the state of trade and the ongoing US government shutdown, which has limited data visibility for the Federal Reserve ahead of its meeting at the end of the month. “Therefore, the US dollar–ringgit is oscillating within a narrow range of RM4.22 to RM4.23,” he told Bernama. Meanwhile, the ringgit fell against the euro to 4.9006/9041 from 4.8838/8907 at Friday’s close, edged lower versus the Japanese yen to 2.7775/7796 from 2.7618/7659, and dropped against the British pound to 5.6369/6409 from 5.6084/6164. The ringgit depreciated versus the Thai baht to 12.9878/13.0030 from 12.8942/9184, narrowed against the Singapore dollar to 3.2562/2587 from 3.2494/2543, slid versus the Philippine peso to 7.26/7.26 from 7.24/7.26, and softened against the Indonesian rupiah to 255.0/255.3 from 254.6/255.1.

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

1 US Dollar

4.2990 2.8050 3.3080 3.0640 4.9840 2.4650 3.3080 5.7300 5.3870

4.1520 2.6910 3.2050 2.9770 4.8220 2.3740 3.2050 5.5460 5.1550 3.3590 57.9500 62.9400 52.9200 4.6100 0.0243 2.7300 40.0700 1.4400 7.0300 112.9700 109.7600 23.0800 1.3400 42.3600 12.1700 112.0200 N/A

4.1420 2.6750 3.1970 2.9650 4.8020 2.3580 3.1970 5.5260 5.1400

1 Australian Dollar 1 Brunei Dollar 1 Canadian Dollar 1 New Zealand Dollar 1 Singapore Dollar 1 Sterling Pound 1 Swiss Franc 100 UAE Dirham 100 Bangladesh Taka 100 Chinese Renminbi 100 Danish Krone 100 Hongkong Dollar 100 Indian Rupee 100 Indonesian Rupiah 100 Japanese Yen 100 New Taiwan Dollar 100 Norwegian Krone 100 Pakistan Rupee 100 Philippine Peso 1 Euro

118.1700 3.5820 60.5400 68.4100 55.7100 4.9100 0.0268 2.8320 15.1000 43.5800 1.5500 7.4700 119.0000 115.6200 25.5700 1.4600 46.5200 13.7300

111.8200 3.1590 62.7400 52.7200 4.4100 0.0193 2.7200 39.8700 1.2400 6.8300 112.7700 109.5600 22.8800 1.1400 42.1600 11.7700 N/A N/A

100 Qatar Riyal 100 Saudi Riyal

100 South Africa Rand 100 Sri Lanka Rupee 100 Swedish Krona

100 Thai Baht

Source: Malayan Banking Bhd/Bernama

Technology Overweight

Carlsberg Brewery Bhd Buy. Target price: RM20

Plantations Neutral

Oct 13, 2025: RM16.52

Source: PublicInvest Research

Source: Bloomberg, RHB Research

Source: PublicInvest Research

CHINA unexpectedly expanded its rare earths export controls last week, adding five new elements and extra scrutiny for chip buyers as the Beijing government tightens control over the sector ahead of talks between the presidents. The US retaliated with new tariffs of 100% on imports from China on top of the current level and would also impose export controls on any advanced chip design software. In our view, both nations are now using export controls as bargaining chips ahead of their scheduled meeting in South Korea next month. China commands more than 90% market share of the world’s processed rare earths and rare earth magnets. There are a total of 17 rare elements, and exports of 12 of them are now restricted after China’s Ministry of Commerce added five-holmium, erbium, thulium, europium and ytterbium, along with related materials. Within the semiconductor value chain, we gather that China’s new export controls will likely hit the chipmakers that use rare-earth-based chemicals during the chip fabrication process and toolmakers that integrate rare-earth magnets into their equipment. We understand that chipmaking machines from ASML and Applied Materials are highly dependent on rare earths because they contain extremely precise lasers, magnets, and other equipment that use these elements. The clearest risk to the industry is facing now is a surge in the prices of rare earth-dependent magnets that are vital to the chip supply chain, which would translate into higher cost of production for advanced chips. We expect to see a knee-jerk reaction in technology stocks, as investors are likely to take profit in view of the rising tension in the chip war amid the current rich valuations. We overweight the sector with top picks being Cloudpoint Technology and Mi Technovation. – PublicInvest Research, Oct 13

THE 10% excise duty hike proposed in Budget 2026 is negative to the brewery sector but could be already in the price with the brewery stocks trading well below their historical mean. Demand could be dented in the immediate term before eventually normalising. Margin expansion and premiumisation strategies will continue to be the primary drivers for earnings growth and high dividend payout. The excise duty on alcoholic beverages including beer will be hiked by 10% effective Nov 1, 2025. Recap, the last increase took place in Mar 2016 when it was rebased from excise per litre of beverage to excise per litre of alcohol in beverage. We expect the brewers to fully pass on the excise duty with ASP adjustments of 4-5%. Malaysia operations accounted for 88% of Carlsberg Brewery’s 1H25 operating profit. A mitigating alternative is by lowering the alcohol content but that will require outstanding R&D effort to reformulate the products without affecting the taste and quality. We highlight the last excise duty hike in 2016 did not lead to adverse earnings impact - Heineken Malaysia and Carlsberg’s Malaysia operations recorded earnings growth of 9% and 15% after Mar 2016. That said, beer ASPs have been raised twice in recent years (Apr 2024 and Aug 2025) hence the upcoming increase could see a stronger impact to demand, after also considering the current subdued consumer sentiment on the back of inflationary pressures. Contraband trade, which has been kept largely at bay in recent years (estimated 25% market share) could capitalise on the wider ASP gap. We anticipate a frontloading in Oct 2025 before the higher excise duty hike kicks in, hence a muted impact to FY25F earnings. We foresee the companies intensifying their marketing efforts via consumer engagements, value promotion etc in stimulating consumption. Maintain BUY, with new RM20 TP. – RHB Research, Oct 13

DESPITE seeing a slowdown in production, palm oil inventory in Sept surged to 2.3m mt, compared to the market estimates of 2.16m mt. Given the current narrow palm oil-soybean oil price gap of US$56/mt, we expect palm oil demand could weaken in the subsequent months. We also expect a steep pull back in the CPO prices from the current high level of RM4,500/mt. Palm oil inventory surpassed 2.3m mt, reaching the highest level since Nov 2023. Meanwhile, stock-to-usage ratio inched up from 10.1% to 11.2%, mainly due to higher palm oil imports while domestic consumption dipped. Exports expanded 7.8% MoM to 1.4m mt, mainly driven by stronger demand from India (+30.3%), the Middle East (+59%), and the US (+134.4%) despite a slump in exports to China (59.7%) and EU (-2.6%). Production could have peaked. CPO production saw a marginal decline to RM1.8m mt as softer production from Peninsular Malaysia (-5.3%) was partially offset by higher production to East Malaysia (+5.9%). We think CPO production could have peaked last month and we expect a gradual decline in the remaining months. The Indonesian government plans to roll out B50 biodiesel in the 2H of next year depending on the outcome of several tests. We understand there are numerous challenges to tackle related to the B50 mandate. The technical issues related to B50 are yet to resolve as several issues were encountered during the B50 trials. Indonesia also does not have sufficient biodiesel capacity to implement B50 next year while funding remains the key concern as higher domestic palm oil consumption would reduce export revenue as the tax collected for the biodiesel subsidy is levied based on palm oil export only. Maintain Neutral on the sector. – PublicInvest Research, Oct 13